Once you have decided to purchase a property and you are satisfied with the size, location, facilities, you should then conduct further due diligence on the property.

What are you buying?

You will find that there is a copy of the Land Title deed attached to the Contract for Sale. This is not always easy to read, especially if the property is part of a strata title.

You need to check whether the property you have inspected is the same property which is on the plan. To verify this, you need to obtain an identification survey. The surveyor will conduct the survey on the property and prepare a plan which will have the following:

Dimensions of the land;

Location of the property in relation to the other houses and cross streets; and

Confirm that the building is properly sited on the land so that the Council would not require any part of the building to be demolished.

What is the usage of the property?

You must check that whether you can use the property for your intended purpose. You can check this by either checking the zoning certificate, the Section 149 Certificate, in the Contract for Sale or by speaking to the town planning section at the local Council.

Property check

Check the property you are buying. Usually there are no doubts as to what are included in the Contract for Sale. However, in many instances the buyer expects the property to be in a particular condition, which is different to what the seller is actually offering.

Sale of a property includes all fixtures, which are items attached to the property or are part of the structure. However the purchase does not normally include anything removable, unless stipulated in the contract.

Agent or seller’s statement

Do not rely on everything said by the agent or the seller, unless the same is mentioned in the Contract for Sale. If any offer or promises has been made by the seller or the agent, ensure that the same is included in the Contract for Sale.

Strata Title

If you are buying a property, such as a residential unit or a commercial unit in New South Wales, the said property will be administered by the Owners Corporation, which is also known as a Body Corporate, in accordance with its obligations under the Strata Schemes Management Act 1996. You will be required to pay levies to the Owners Corporation to contribute to the management of the building and grounds.

You need to arrange to carry out a search of the books of the Owners Corporation to find out the levies you are required to pay, the present financial position and what amounts it may have set aside for future maintenance. The Minutes of the Council of the Owners Corporation also indicates whether there are any issues or problems with the building or any disputes among the existing owners.

Home building insurance

Builder warranty insurance is always present in the Contract for Sale if any building work has been done in the previous 6 years, the value of which exceeded $12,000. In case a building agreement is in place, the seller must attach an Insurance Certificate to the Contract for Sale.

Before entering into the Contract for Sale, you should obtain from the seller details about the existing insurance cover for the property and the procedures available for the resolution of any dispute that may arise.

Sewer connections

Drainage or sewer plans are normally included in the Contract for Sale showing the location of any sewer mains and the connections from the building to the sewer.

If you have any plans to carry out any extensions to the building which might get closer to or over the sewer, you may not get building approval for the same or the building costs may increase substantially.

Deposit

You need to budget for payment of the deposit once you have agreed on the price quoted by the seller.

Normally the deposit is 10% of the purchase price. However, it is relatively common for sellers to agree on a 5% deposit.

Finance

You need to have sufficient funds to pay for the property, before you enter into the Contract of Sale. It means that if you are obtaining finance for the purchase of the property, you should ensure that you have pre approval from the lender before you enterinto the contract.

Duty

In most of the cases, you will have to pay stamp duty on the purchase. You need to keep these in your mind while arranging for funds to purchase the property. The amount of the duty depends on the price you pay for the property.

If you are planning to purchase a property our experts at Owen Hodge can help you to carry out the appropriate due diligence checks and ensure your property transaction runs are smooth as possible.

4 Step Process of Property Settlement
Buying a Home by Auction vs. Sale
Swimming Pools Amendment Act 2012, NSW
Buying a Home or Residential Property
Buying, Selling Or Leasing a Residential Property With A Swimming Pool
Caveats
Can I change my mind after I have put a deposit on a home?
FAQ’s about Property Law
Corporate Scheme Registration And Community Management Statements
Flood Damage and Contracts
How To Ensure A Smooth Property Transaction
Professional Fees Quote and Total Costs Quote
Purchasing a Home or Residential Property

Off the Plan Sales/Purchases
Search that Should be Completed By Buyer – Due Diligence
Searches Required to be Attached to the Contract of Sale
Selling A Home Or Residential Property
Settlement Process
Strata Management Body
Strata Management Law and Regulations
The Right To Cool Off In 2013
Watching out for the Special Conditions of a Sale of Land
What Does The Standard Contract Of Sale Cover?
Selling A Home or Residential Property
Useful Terms
Boarding Houses Act 2012

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